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Examining the Impact of Political Structures on Ethiopian Institutions

 The Quality of Institutions in Ethiopia (2018-)

In a landscape marked by shifting political alliances and economic uncertainty, Ethiopia stands as a testament to resilience and adaptability. This chapter delves into the intricate relationship between state fragility and its impact on business and economic performance, offering a lens through which to view the Ethiopian experience. The recent reforms initiated by the government signal a pivotal moment in the nation’s history, aiming to liberalize the economy and attract foreign investment. However, these efforts are juxtaposed against the backdrop of ethnic tensions and political unrest, underscoring the fragility of the state apparatus.A pivotal focus of our discussion is the government’s endeavor to balance between maintaining control and fostering a conducive environment for business growth and economic development. The establishment of industrial parks, incentives for foreign direct investment, and initiatives aimed at improving the ease of doing business in Ethiopia are significant steps towards this goal. Yet, the journey is fraught with challenges. The narrative of Ethiopia’s economic resilience is interwoven with tales of businesses navigating through bureaucratic hurdles, infrastructural deficits, and a rapidly changing regulatory landscape.

Ethiopia’s experience highlights a critical aspect of dealing with state fragility – the imperative for coherent strategies that align economic reforms with the strengthening of political and social institutions. This balance is essential for sustaining growth, enhancing business confidence, and ultimately, achieving economic transformation.

Through a detailed analysis of Ethiopia’s economic landscape, this chapter uncovers the nuanced interplay between state policies, business dynamics, and economic outcomes. It presents a comprehensive overview of the hurdles and opportunities that lie ahead for Ethiopia, as it strides toward a future marked by stability, prosperity, and inclusive growth. An essential read for policymakers, business leaders, and scholars, this examination sheds light on the complexities of navigating state fragility in pursuit of economic performance, within the unique context of Ethiopia.

The Quality of Institutions in Ethiopia (2018-)

Effectiveness of governance and institutions: Political structures and state institutions are too weak and fragile to make advances that are critically needed for modernization. Over the last few years, the country appears to be in a state of “suspended statehood” where there are still recognized borders but most things inside are falling apart due to conflict, anarchy and lawlessness. Even though a common history is not an essential condition for shared future prosperity, Ethiopians have maintained unity and a profound sense of national identity for generations. However, this consciousness has not been sufficiently reflected in its national institutions. State institutions were not effective or efficient and often failed to reflect citizens’ identity or values. They appear to be controlled by a group with a different identity and mindset from that of ordinary citizens. For example, the country has not yet resolved the flag issue as some groups want the old imperial flag while others prefer the flag with a different emblem. This controversy has led to conflict and unnecessary loss of lives. The establishment and maintenance of credible and strong institutions is more important than the presence or absence of a common national history or identity. State power and institutional reach have been less extensive than its territorial jurisdiction. Even in areas where the government has control, people do not receive basic services and the state is not able to ensure the physical security of citizens. The failure of institutions to deliver comes from centrifugal social forces and the polarization of political life.

Government effectiveness (GE) is largely a function of the competence of the civil service, the quality of public service delivered to citizens and the degree of its independence from political pressures. Competence of the civil service is attained by hiring and promoting civil servants based on merit and performance while quality of public service relates to effective implementation of government policy or decisions (limited red tape or delays). It also includes policy consistency and effective coordination with other state agencies, as well as the existence of a citizens information service (and effective appeals mechanism) (World Bank, 2020). Levi (2006) describes an effective government as one that protects the people from violence while ensuring the honesty and competence of its bureaucracy and enabling the provision and maintenance of infrastructure that makes possible the exchange of goods and delivery of services. The existence of civil and political freedoms is not a necessary precondition for GE. Popular support for democracy may suffer in cases where representative governments are plagued by deep institutional failures in policymaking and implementation (Magalhaes, 2014). Studies indicate that the survival of autocracies increases with GE, i.e., adoption of institutions that foster credible commitments and increase transparency in policy making (Ghandi & Przeworski, 2007).

            In 2023, Ethiopia is reported at 31.25% in GE (percentile rank) (World Bank, 2023). The quality of public services seems to have deteriorated over the last few years. It now takes weeks to get things done such as obtaining an identity card or a passport. Citizens wait in long lines while bureaucrats are taking long lunch breaks or reject applications for minor lapses such as the absence of a date or a signature. Citizens are often asked to come back another day because the officer is not available, or the computer system (or there is internet shutdown) does not work. This problem has also moved to US embassies and consulates overseas. Even though there is a diaspora office in many embassies, bureaucrats are not in their offices to respond to the needs of citizens. A citizen who had issues with his passport had this to say about his experience with the Embassy in Washington DC:

“ I have been calling the embassy for the last four days. No one is answering my calls. They have now moved their poor service and overall inefficiency from Ethiopia to the US. No business would survive such abuse of customers. Anyways, with government we must take such abuses inside and outside the country”.

The quality of civil service has deteriorated partly because of the declining quality of secondary and university education as well as the increasing use of fake degrees to obtain jobs. The government does not invest resources to check the authenticity of the documents to ensure that the people they hire are qualified.

Recent data shows that a third of the population is without safe water while another 28% have limited access to safe water because it takes over thirty minutes to retrieve it because of distance and/or overcrowding. In the area of health services, there are enduring problems of lack of access to quality healthcare. Access to modern healthcare is non-existent in many rural areas. There is shortages of personnel, equipment, and drugs and all these problems have been exacerbated by the ongoing conflict. In 2019, it takes 52 days to register a business compared to 4 days for S. Korea and New Zealand and 33 days for Ghana. Its overall ease of business ranking has also declined. Government effectiveness has been challenged not only in terms of delivery of basic services but also in the state’s low level of transparency, responsiveness, and accountability to its citizens.

 

Weak parliament and opposition: Since the emergence of modern representative institutions in Africa, parliaments have remained relatively weak compared to the executive and judicial branches of government. There is a global decline in parliamentary power, privilege and prestige compared to the growing power of the executive (Alabi, 2009). In many countries, legislative institutions have often been subject to outright abolition, suspension, or dissolution due to successive military coup d’etats. Even in cases where they exist, they have diminished powers and play a secondary role under a one-party dominant rule. The legislatures have largely failed to serve as an effective counterweight to executive power. It is often described as an irrelevant talking shop and the weakest link in the making of public policy. A former chairman of the commonwealth parliamentary association succinctly described the state of parliament in many developing countries:

“Parliament performed a rubber stamp function in that the government took parliament for granted and expected rubber stamping of government bills and other proposals which are routinely submitted to parliament for approval” (Commonwealth parliamentary Association, 2002, p.5)

 

Political science scholars state that parliamentary systems of government (compared to presidential systems) are less likely to democratize because they create a highly institutionalized ruling party organization and structure that not only allows power sharing among ruling elites (appointments and other career ambitions for members) but also provides greater opportunities for electoral manipulation (Higashijima & Kasuya, 2022). As it can facilitate an effective distribution of patronage, it is able to maintain a loyal political elite and may even incentivize potential opponents into a winning coalition.

In Ethiopia, the ruling party (Prosperity Party or PP) that won elections in 2021 now controls almost all regions (except in areas where elections were not held) including the security apparatus and the bureaucracy. The small role of the opposition helps the ruling party to entrench PP’s dominance over the political life of the country. There is a bi-cameral legislature composed of the House of Peoples’ Representatives (HPR) that makes laws and the House of Federation (HOF) that serves as a constitutional court dealing with issues of self-determination, appropriation of revenue between the Federal and state governments.

Parliament has an important role under the constitution: making policies and laws, exercising oversight over the executive, and representing the people. A parliament that encourages public participation, addresses the concerns of its constituents, and widens the political space to also recognize the role of the media helps to strengthen and consolidate democracy. However, the existing legislature suffers from several shortcomings:

v  Party loyalty over the interest of constituents: There is a perception that parliamentary members put more emphasis on the needs of the ruling party and government than on promoting the interests of voters. Even though they are expected to meet their constituents twice a year, such consultations are considered inadequate to address community needs and concerns.

v  Parliament is not living up to its constitutional obligations: An important role of parliament is to hold government officials accountable for their decisions. There is limited scrutiny over government programs and plans, appointments, or expenditures on different projects. There is little debate on alternative policies and parliament rubber stamps any legislation or budget that comes from government. The role of the legislature in exercising checks and balances over the executive leaves much to be desired. In many cases, legislators are hastily convened to deliberate and pass a proposal without being given the opportunity to consult their constituents.

v  Parliament’s credibility has suffered a decline amidst the security and economic crisis: The political and social instability in the country further undermined the credibility of the legislative body. During the time when a) the civil service in different parts of the country was not paid for several months in 2023, b) thousands of citizens’ homes in Sheger city were being demolished by executive order, and c) thousands of people were being displaced by conflict, parliament appeared unconcerned and detached. These are important issues for which parliament must hold government officials accountable for their actions/inactions. They have the power to withhold the budget and ask for the resignation of public officials. Strong legislatures have even resorted to changing the leadership of their governing party for a rift on policy issues between the government and parliament. A parliament that fails to challenge or goes along with the executive in the face of mounting social and economic crisis is one that has largely abdicated its constitutional obligations. They must remember that their allegiance is to the country and its laws and not to the executive.

 One of the factors that has contributed to a weak legislature in Ethiopia is the absence of a strong opposition. Strong opposition parties are essential institutions that enable political groups to organize and contest for power thus facilitating a peaceful transfer of political authority. They critically engage with government challenging its policies and programs, monitor government performance and expose corruption. As Jung & Shapiro stated:

“Opposition institutions –have an interest in asking awkward questions, shining light in dark places and exposing abuses in power—-serve as a check on governments which have an incentive to camouflage mistakes or controversial decisions that might threaten their popularity” (Jung & Shapiro, 1995 p. 271).

 

In the initial stages of democratization, opposition parties with strong organizations and citizen reach can pose a challenge to the regime. Nandong (2020) finds that rulers have strong incentives to co-opt opposition parties with weak organizational strength. This improves the regime’s democratic credentials and effectively terminates the opposition’s anti-regime activities. Well organized opposition groups with strong grassroot ties are likely to threaten the status quo and the ruler has a strong desire to substitute co-optation with repression to undermine their progress.

A strong national opposition party (non-ethnic based) could be viable if it can devise programs and policies that can attract the support of a diverse set of constituents. Other than prohibiting ethnic-based parties, electoral rules can require political parties to establish cross-cutting membership. A national political party can be required to have the support of people from at least 30 percent of the regions. This prevents parties with a narrow ethnic base and limited nation-wide support.

Such a party would have to offer a set of social and economic policies for all groups in society. It must also focus on poverty reduction and the creation of employment opportunities. Such parties, however, are likely to face state repression because of their potential to upset the balance of power.

The failure of parliament in Ethiopia can also be attributed to the absence of an enabling environment for robust engagement with government. This requires strengthening capacity, i.e., independent budget, well-trained staff outside the direct control of the executive and other facilities that allow them to adequately discharge their responsibilities. They must safeguard their independence from the executive if they are to enforce government accountability, gain the confidence of the electorate. At present, there is a perception that parliament is a subservient mouthpiece of a high-handed executive.

 

Judicial institutions: Over the last two decades, many countries have implemented constitutional reforms and transferred power from representative institutions to judiciaries (bill of rights, judicial review) (Hirschl, 2003). There have been efforts to establish powerful independent courts to strengthen the rule of law. The World Bank (2017) helps many developing countries to undertake judicial reform on the grounds that rule of law promotes economic growth. The argument for independent judicial institutions arises from the fact that they enable proper functioning of government by enforcing laws and by protecting minority rights.

Judicial independence is the concept that the judiciary should be free from the influence of other branches of government and that of private and partisan interests. It serves as a foundation for the rule of law which underscores that all authority and power comes from the ultimate source of law and that all peoples and organizations are held accountable to the same set of laws (Helmke and Rosenbluth, 2009).

Judicial independence tends to correlate with democratic political systems than dictatorships. This is because democratic regimes allow adjudication of disputes according to agreed-upon principles without regard to political power or social position of individuals. In cases when non-democratic regimes commit to an independent judiciary, courts rarely succeed in establishing rule of law. For example, judges under military or one-party regimes fail to protect citizens from human rights violations by state security. The InterAmerican Commission on Human Rights stated:

“The courts only challenged the legality of the military regime’s detentions in two or three tens of a percent cases” (IACHR,1985, p.115)

In Mexico where the PRI was the dominant ruling party for about 70 years, courts lacked independence from political influence despite judges’ constitutionally protected security of tenure. They also lacked jurisdiction over politically salient cases and subservient to a powerful executive (Magaloni, 2003). Under the presidency of Zia in Pakistan (1977-1988), nearly all judges under his predecessor resigned or were removed from office. Control of the judiciary was facilitated by appointing judges to serve on an ad hoc basis for several years before confirmation. Ad hoc judges are likely to be loyal and support the regime’s agenda because they would not risk their job by annoying the executive (Kureshi, 2021).

In Ethiopia, there are several challenges to judicial independence and rule of law. First, despite the various provisions in the constitution about the duty to respect and enforce human rights by all levels of government, the judiciary has no role in interpreting the provisions of the constitution. At this time when there are ongoing conflicts and human rights violations in many parts of the country, the inability of the judiciary to handle such cases is problematic and undermines its relevance. Secondly, courts often fail to respect the constitutional rights of the accused. They are prone to dismissing habeus corpus even for minor offenses. There is a perception that the judiciary is subject to political influence and corrupt. There are several cases where criminal suspects arrested for major crimes are quickly released by the judiciary because of political connections or corruption.  Thirdly, there are limited opportunities for judicial review of executive actions (including that of administrative agencies). Such powers have been gradually chipped away by regulations that prohibit any legal scrutiny or judicial review. In many cases, decisions of administrative agencies are final and not subject to judicial review. Moreover, courts do not have the power to determine the legitimacy of the acts of parliament based on the constitution. The constitutionality of Federal or state legislative actions (regulations, directives) or international agreements are subject to review by the House of Federation and not the judiciary. In Ethiopia, constitutional reform has effectively transferred power from the judiciary to other branches of government.


 

(The above excerpt was taken from the book entitled: “State fragility, Business and Economic Performance: An Ethiopian Experience. Palgrave Macmillan. 2024, pp. 118-125).

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